Division of Labour: February 2012 Archives
February 29, 2012
If It Keeps Them Busy: Stache Act Edition

From The Weekly Standard:

“The Stache Act (Stimulus to Allow for Critical Hair Expenses) aims to earn a well-deserved $250 annual tax deduction for every Mustached American for expenditures on mustache grooming supplies.”

Read the whole thing--it is a joke.

Posted by E. Frank Stephenson at 08:31 AM

February 28, 2012
A Great Way to Spend a Saturday

IHS is holding a one day seminar in Atlanta on March 24. Students within a few hours of Atlanta might find this a great day to hear some fantastic lectures on liberty and to find out about additional opportunities for internships, scholarships, or other seminars.

Posted by E. Frank Stephenson at 12:28 PM

T. Boone Rentseeker

Today's WSJ takes T. Boone Pickens to task for trying to get the federal government to pony up some natural gas subsidies for vehicles. He's been working this angle for a few years; I offered my take in the April 2009 issue of The Freeman.

Posted by E. Frank Stephenson at 10:12 AM

February 27, 2012
"Free up your economy or bust..."

...is the message that the World Bank gave to ______ (the US? Greece? the entire world?)


The report is compiled by the World Bank and the Development Research Center, a research group that reports directly to China's State Council. It encourages China to promote innovation, competition and entrepreneurship as means of economic growth, rather than allowing growth to be primarily government engineered.

If doctors have unlimited job security because people will always get old and sick, then economists have unlimited job security because people always forget what we've tried to teach them.

The world's second-largest economy has been rising rapidly, averaging around 10% growth a year for the last three decades. Much of that momentum has come as China's rural population moves into the cities and as the government has funded massive infrastructure projects and retained a powerful influence over the country's biggest companies.

They don't answer the chicken-or-egg question of whether the 10% growth was the cause or effect of the growth of China's government.

Their latest report to the commission puts it bluntly: The Chinese government has not "expressed an interest in becoming a bastion of free market capitalism."

Some people (Occupiers?) would consider that glowing praise.

Posted by Tim Shaughnessy at 11:13 AM in Economics

February 25, 2012
Pot Meet Kettle

Peter Morici: Obama puts too much faith in faulty economics thinking

Posted by E. Frank Stephenson at 09:44 AM

February 22, 2012
Aeon Skoble on Smoking Bans

One of the highlights of teaching at several IHS seminars over the past decade has been the fantastic teaching offered by other faculty members. One of my favorites is philosopher Aeon Skoble of Bridgewater State. In this video he takes on the smoking bans that have become commonplace around the country.

Posted by E. Frank Stephenson at 09:09 AM

Paging Dr. Laffer ...
The Treasury received £10.35 billion in income tax payments from those paying by self-assessment last month, a drop of £509 million compared with January 2011. Most other taxes produced higher revenues over the same period.

Senior sources said that the first official figures indicated that there had been “manoeuvring” by well-off Britons to avoid the new higher rate. The figures will add to pressure on the Coalition to drop the levy amid fears it is forcing entrepreneurs to relocate abroad.

The self-assessment returns from January, when most income tax is paid by the better-off, have been eagerly awaited by the Treasury and government ministers as they provide the first evidence of the success, or failure, of the 50p rate. It is the first year following the introduction of the 50 [percent] rate which had been expected to boost tax revenues from self-assessment by more than £1billion.


Posted by E. Frank Stephenson at 08:06 AM

February 21, 2012
Markets in everything -- cremation with implants

From Gizmodo:

"What Happens to Medical Implants When Their Owners Are Cremated"

Medical advances mean that many us aren't just made up of bone and flesh these days: artificial knees, titanium plates and pacemakers make their way into human bodies across the world every day. But what happens to them when their owners are cremated?

A report by the BBC offers some reassuring news. Fortunately, all the metal doesn't go to waste. In fact, there's a booming business in recycling the implants that get left behind when corpses make their way into the incinerator.

Posted by Edward J. Lopez at 12:55 PM in Economics

February 20, 2012
P.J. Hill in the House

Many thanks to P.J. for regaling our students with tales of the not so wild, wild west. Anyone who has not read the book should put it at the top of the to-be-read pile.


Posted by E. Frank Stephenson at 09:43 PM

February 16, 2012
On Public Employee Pay

Part of the abstract of a Journal of Economic Perspectives article by Maury Gittleman and Brooks Pierce on public employee compensation:

After controlling for skill differences and incorporating employer costs for benefits packages, we find that, on average, public sector workers in state government have compensation costs 3-10 percent greater than those for workers in the private sector, while in local government the gap is 10-19 percent.
Posted by E. Frank Stephenson at 09:42 PM

Taxes Are For Chumps

Looks like Bob's favorite Ohio Senator Sherrod Brown has a bit of difficulty paying his property taxes on time. Maybe he's just auditioning for a future job as Treasury Secretary. Or maybe, as he contends, it's just an oversight. (I wonder if posting this will get me a call from him too!)

Posted by E. Frank Stephenson at 09:29 PM

February 15, 2012
What Milton Means To Me Video Contest

From the inbox:

As part of Milton Friedman’s Century, Free To Choose Network has kicked off the “What Milton Means to Me” video contest! The contest is open to all ages and offers a chance for you to tell the world what, exactly, Milton Friedman means in your life. Whether it’s a personal encounter you had with him or a change in perspective caused by reading or viewing his works, Friedman has impacted the lives of so many around the world and we’d like you to tell your story. Write poem, compose a rap, create a Milton Friedman flashmob or come up with something we’re not even smart enough to think of – just be creative and have fun! Prizes total $2,500.

We also reward those teachers/professors who spread the word by offering a $250 bonus if their student wins!

More information here.

Posted by Joshua Hall at 09:35 AM in Economics

February 14, 2012
Mike Lester on the Chevy Volt

From the Rome News-Tribune. Lester's cartoon is prescient because since its publication the Obama budget has been released and it calls for upping the Volt buyers' subsidy from $7,500 to $10,000.

Lester Volt.jpg

Posted by E. Frank Stephenson at 08:46 AM

The Greedy Hand

White House Economic Adviser: 'We Need a Global Minimum Tax'

Posted by E. Frank Stephenson at 08:37 AM

We're From the Government & We're Here to Help: College Tuition Edition

The abstract of a new NBER WP:

We use administrative data from five states to provide the first comprehensive estimates of the size of the for-profit higher education sector in the U.S. Our estimates include schools that are not currently eligible to participate in federal student aid programs under Title IV of the Higher Education Act and are therefore missed in official counts. We find that the number of for-profit institutions is double the official count and the number of students is between one-quarter and one-third greater. Many for-profit institutions that are not Title IV eligible offer programs and certificates that are similar, if not identical, to those given by institutions that are part of Title IV. We find that the Title IV institutions charge tuition that is about 75 percent higher than that charged by comparable institutions whose students cannot apply for federal financial aid. The dollar value of the premium is about equal to the amount of financial aid received by students in eligible institutions, lending credence to the “Bennett hypothesis” that aid-eligible institutions raise tuition to maximize aid.
Posted by E. Frank Stephenson at 08:36 AM

Romance Is In The Air

Chris Coyne on the economics of Valentine's Day.

Posted by E. Frank Stephenson at 08:15 AM

February 09, 2012
Unicorn Alert

Harry Reid's infamous take on job-creating millionaires:

CBS News spotted one:

Posted by Wilson Mixon at 02:32 PM

February 08, 2012
Labor Force Shrinkage

This remarkable discovery from the Boston subsidiary of the New York Times:

The Center for Labor Market Studies at Northeastern University found that there were 5.4 million fewer people in the workforce last year than projected by the Labor Department in 2008 - many the “hidden unemployed’’ who, no longer searching for work, are not counted in the official jobless rate. In Massachusetts, their numbers have more than doubled over the past decade to about 120,000.

Posted by Wilson Mixon at 05:27 PM in Economics

February 07, 2012
Markets in Everything: Bacon Milkshake

Story here.

Hey, bacon works on nose bleeds too (HT: Instapundit).

Posted by E. Frank Stephenson at 02:21 PM

Why Not Just Call It Enslavement?

From the NYT (italics added):

Americans recognize rights not widely protected, including ones to a speedy and public trial, and are outliers in prohibiting government establishment of religion. But the Constitution is out of step with the rest of the world in failing to protect, at least in so many words, a right to travel, the presumption of innocence and entitlement to food, education and health care.

There's a good reason that the U.S. Constitution or any other constitution should not recognize entitlements to food etc.--such a "right" implies an obligation that someone else provide the food or medical care. While many people believe that in a decent society people should voluntarily help others, compelling a person to provide another with food or medical care or whatever is enslavement. It is depressing that this point was not mentioned in the NYT article and that Justice Ruth Bader Ginsburg thinks the U.S. Constitution is an anachronism because it eschews such provisions.

Posted by E. Frank Stephenson at 08:58 AM

February 06, 2012
Speaker Moonbeam

Posted by E. Frank Stephenson at 09:15 AM

February 05, 2012
Martin Wolf Dispenses Hooverite Nonsense

It's been awhile since I've bothered to point out someone's ignorance about Herbert Hoover's economic policy but here's one worth noting.

FT's Martin Wolf, the author the superb Why Globalization Works, thinks that British policymakers' belief that fiscal stimulus would not help the sluggish British economy indicates they think Herbert Hoover was correct. Never mind that Hoover wasn't much of a fan of fiscal restraint either since he boosted spending some 50% during his four years in office.

Of course, it is also silly to think that current British policy rises to anything resembling "masochism in economic policy" as Wolf claims. Don Boudreaux and Scott Sumner point out that British spending has increased since 2007 and that Britain's budget deficit as a share of GDP trails only Greece and Egypt among 44 major economies tracked by The Economist.

Posted by E. Frank Stephenson at 03:50 PM

February 01, 2012
Don Boudreaux on Wage Stagnation

Posted by E. Frank Stephenson at 02:02 PM

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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